<![CDATA[Grist - Comment Feed for Busted: Majority of emissions cuts can come from public spending]]> Grist Comment Feed en Comment #1 by Jon Rynn http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Fri, 25 Jul 2008 06:56:47 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/1 Public likes public investment

As argued in this post from DR a year ago, "The promise and perils of public investment in energy", where he references an article by Teague and Navins in American Prospect.

They argue, based partly on polling, that the public would be much more open to mitigating global warming via public investment than via carbon pricing (Teague and Navins use the word "regulation", which seems to mean carbon pricing.  Also, Navins is head of the shop Shellenberger works for, but he doesn't call for gee-wiz innovations).

The article is timely, I think, because it addresses the issue of the perceived cost of global warming mitigation, which the rise in the cost of gasoline is making worse.  In other words, they anticipated that proposing a carbon price would lead to accusations of trying to impoverish people, while public investment avoids that problem.  

Also, on the subject of where to get the money, "The Decline of Corporate Income Tax Revenues" shows that they went from 21% of Federal revenues in the 1950s to only 7% now; if the Federal budget is 2 trillion, then bringing it back up to 21% would yield at least $300 billion (about 15% of 2 trillion).

]]> Public likes public investment

As argued in this post from DR a year ago, "The promise and perils of public investment in energy", where he references an article by Teague and Navins in American Prospect.

They argue, based partly on polling, that the public would be much more open to mitigating global warming via public investment than via carbon pricing (Teague and Navins use the word "regulation", which seems to mean carbon pricing.  Also, Navins is head of the shop Shellenberger works for, but he doesn't call for gee-wiz innovations).

The article is timely, I think, because it addresses the issue of the perceived cost of global warming mitigation, which the rise in the cost of gasoline is making worse.  In other words, they anticipated that proposing a carbon price would lead to accusations of trying to impoverish people, while public investment avoids that problem.  

Also, on the subject of where to get the money, "The Decline of Corporate Income Tax Revenues" shows that they went from 21% of Federal revenues in the 1950s to only 7% now; if the Federal budget is 2 trillion, then bringing it back up to 21% would yield at least $300 billion (about 15% of 2 trillion).

]]> Comment #2 by cscoxk http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Sat, 26 Jul 2008 08:55:29 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/2 Reducing emissions is not an impost on the economy

Emissions reduction is not an impost on the economy. The reason it is thought to be an impost is that economists believe that increasing prices is the only way to get investment in renewables and in energy savings. There is another way and that is to Reward people for reducing emissions and require the Rewards money to further reduce emissions. The same principle applies to Water and you can see how reducing the amount of water makes it cheaper for my local area.

http://cscoxk.wordpress.com/2008/07/27/making-better-use- ...

If you do the same calculations for energy reduction you will find the same outcome. That is instead of increasing the price of polluting energy pay people not to use it but require them to spend the Rewards they receive on ways to produce an equivalent product that has no emissions.

If the equivalent product is cheaper to produce then this will in the long term result in lower costs for the product. The running costs of renewable energy sources are ALL cheaper than burning fossil fuel because the fuel is "free".

Economists with their concentration miss the main point that it is investment that gives us wealth. If we concentrate on distributing investment money to amplify the effect of the investment dollar we can have a net zero emissions economy within any time frame we wish. I think ten years is probably good enough - but we could make it five or twenty. At the end of the time we will be wealthier but it will be the people who conserved who will be the owners of the new renewable energy assets.

]]> Reducing emissions is not an impost on the economy

Emissions reduction is not an impost on the economy. The reason it is thought to be an impost is that economists believe that increasing prices is the only way to get investment in renewables and in energy savings. There is another way and that is to Reward people for reducing emissions and require the Rewards money to further reduce emissions. The same principle applies to Water and you can see how reducing the amount of water makes it cheaper for my local area.

http://cscoxk.wordpress.com/2008/07/27/making-better-use- ...

If you do the same calculations for energy reduction you will find the same outcome. That is instead of increasing the price of polluting energy pay people not to use it but require them to spend the Rewards they receive on ways to produce an equivalent product that has no emissions.

If the equivalent product is cheaper to produce then this will in the long term result in lower costs for the product. The running costs of renewable energy sources are ALL cheaper than burning fossil fuel because the fuel is "free".

Economists with their concentration miss the main point that it is investment that gives us wealth. If we concentrate on distributing investment money to amplify the effect of the investment dollar we can have a net zero emissions economy within any time frame we wish. I think ten years is probably good enough - but we could make it five or twenty. At the end of the time we will be wealthier but it will be the people who conserved who will be the owners of the new renewable energy assets.

]]> Comment #3 by PJD http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Sun, 27 Jul 2008 04:22:34 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/3 Corporate Tax

One of the main problems with Jon Rynn's suggestion to raise corporate taxes to reach a target portion of federal revenue is that with globalization it is far too easy for companies to shift revenue around to countries with lower tax rates.  This is especially true for industries where the value of intellectual property is hard to determine.

A company like Microsoft can sell intellectual property to it's Irish subsidiary which does some ill-defined adding of value and then books a lot of revenue with tax going to the Irish government which is willing to take a smaller cut.

I support the progressive individual income tax.  If high paid individuals want to actually live in countries with far lower individual income tax rates, so be it.  But having a corporate tax rate higher than other countries simply leads to offshoring of business and jobs.

Highly profitable companies are good for everyone, especially considering that so much equity is owned by everyday middle class people through pensions and retirement accounts.

Maybe progressives should consider lowering corporate tax rates to be competitive with countries like Ireland and then raise dividend and capital gains tax rates.

]]> Corporate Tax

One of the main problems with Jon Rynn's suggestion to raise corporate taxes to reach a target portion of federal revenue is that with globalization it is far too easy for companies to shift revenue around to countries with lower tax rates.  This is especially true for industries where the value of intellectual property is hard to determine.

A company like Microsoft can sell intellectual property to it's Irish subsidiary which does some ill-defined adding of value and then books a lot of revenue with tax going to the Irish government which is willing to take a smaller cut.

I support the progressive individual income tax.  If high paid individuals want to actually live in countries with far lower individual income tax rates, so be it.  But having a corporate tax rate higher than other countries simply leads to offshoring of business and jobs.

Highly profitable companies are good for everyone, especially considering that so much equity is owned by everyday middle class people through pensions and retirement accounts.

Maybe progressives should consider lowering corporate tax rates to be competitive with countries like Ireland and then raise dividend and capital gains tax rates.

]]> Comment #4 by Gar Lipow http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Sun, 27 Jul 2008 05:02:46 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/4 Income Taxes

>One of the main problems with Jon Rynn's suggestion to raise corporate taxes to reach a target portion of federal revenue is that with globalization it is far too easy for companies to shift revenue around to countries with lower tax rates.

And yet many nations manage to be prosperous with higher corporate income taxes than we have. That is because if have the will you can guard against paper shifting. And if we used this money productively for education, health care, infrastructure and so on, it turns out there are often business advantages to doing locating factories and campuses in a nation with the kind of benefits a strong government sector can provide.  

]]> Income Taxes

>One of the main problems with Jon Rynn's suggestion to raise corporate taxes to reach a target portion of federal revenue is that with globalization it is far too easy for companies to shift revenue around to countries with lower tax rates.

And yet many nations manage to be prosperous with higher corporate income taxes than we have. That is because if have the will you can guard against paper shifting. And if we used this money productively for education, health care, infrastructure and so on, it turns out there are often business advantages to doing locating factories and campuses in a nation with the kind of benefits a strong government sector can provide.  

]]> Comment #5 by Jon Rynn http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Sun, 27 Jul 2008 05:27:22 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/5 NYC same thing

I remember back in the 1980s then Councilwoman Ruth Messinger (who unfortunately lost to Giuliani in a Mayor's race, if memory serves) argued that NYC should stop giving tax breaks to big companies to stay in NYC, because they would stay for exactly the reasons Gar outlined.  Location of human and physical capital is generally much more important than tax rates.  But we should certainly raise the dividend and capital gains taxes too!

And once again, I'll point out that employee-owned-and-operated firms would not run away to a lower tax rate or even lower wage-rate country (expanding internationally is a different thing, as we know, Gar).

]]> NYC same thing

I remember back in the 1980s then Councilwoman Ruth Messinger (who unfortunately lost to Giuliani in a Mayor's race, if memory serves) argued that NYC should stop giving tax breaks to big companies to stay in NYC, because they would stay for exactly the reasons Gar outlined.  Location of human and physical capital is generally much more important than tax rates.  But we should certainly raise the dividend and capital gains taxes too!

And once again, I'll point out that employee-owned-and-operated firms would not run away to a lower tax rate or even lower wage-rate country (expanding internationally is a different thing, as we know, Gar).

]]> Comment #6 by Des Emery http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/ Sun, 27 Jul 2008 12:07:16 -0700 http://www.grist.org/article/myth-all-solutions-to-climate-chaos-raise-prices/6 Corporate and Income Taxes

An alternative I hardly ever see considered is the removal (gradually, to lessen the shock) of all corporate taxation and the simultaneous increase of personal income tax derived from "interest and investment."

Shareholders would find that a graduated tax rate would be incentive for them to pressure corporations to invest their profits in lower prices, more R and D, higher employment, while the same shareholders would still receive stable and moderate "return on investment."

 

Des Emery

]]> Corporate and Income Taxes

An alternative I hardly ever see considered is the removal (gradually, to lessen the shock) of all corporate taxation and the simultaneous increase of personal income tax derived from "interest and investment."

Shareholders would find that a graduated tax rate would be incentive for them to pressure corporations to invest their profits in lower prices, more R and D, higher employment, while the same shareholders would still receive stable and moderate "return on investment."

 

Des Emery

]]>